July 18, 2024, 9:59 am

Staff Correspondent

2024-07-09 08:00:49 BdST

BB introduces ‘exit facility’ to reduce defaults

The Bangladesh Bank (BB) on Monday issued new guidelines to curtail the number of unwilling defaulters in the country, allowing businesses to regularize balance sheets with 10% upfront payment.

Commercial banks have been asked to formulate individual policies in this regard.

Under the facility, both existing and potential unwilling defaulters can regularize their credit records. Here, unwilling defaulters refer to those business entities which have defaulted on bank loans or are set to default due to unforeseen circumstances that can cause major business losses or even a complete shutdown of activities.

Businesses availing the facility would have to complete loan payment within maximum three years on payment of 10% of the lent sum in cash in one go, and cannot take new loans before completing the payment of existing loans.

In the meantime, their credit rating would remain intact, the circular issued in this regard said.

The executive committee of a bank has the authority to approve applications seeking such facility. However, in case of maximum Tk10 lakh total loan, the bank management can decide on approving applications.

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